KUALA LUMPUR: The government reaffirmed its ongoing contract with Spanco Sdn Bhd for the management of its vehicle fleet.
The Finance Ministry, in a parliamentary written reply, said the government has always ensured the procurement contract with Spanco for supplying, maintaining and managing the government's vehicle fleet was carried out according to the requirements, complies with procurement procedures and followed all necessary due diligence.
"At present, the contract is still ongoing based on the agreement that was signed between the government and Spanco," read the reply.
The ministry said this in response to Lim Lip Eng's (PH-Kepong) question dated March 12 on whether the awarding of government vehicle supply and maintenance contracts to Spanco is detrimental to the country.
In 1993, Spanco was given a 25-year concession agreement with the government, which allowed the company to provide and lease cars with full maintenance services for the government.
In 2019, Spanco's concession agreement with the government expired. Following this, an open tender was initiated by the government for the contract to supply, maintain and manage its fleet of official vehicles for the next 15 years. Proposals were reportedly received from at least seven companies.
In the same year, Berjaya Group and Naza Corporation Holdings Sdn Bhd formed a consortium to jointly bid for the lucrative contract.
However, Berjaya founder Tan Sri Vincent Tan on July 17 last year, filed a lawsuit against the Finance Ministry and Spanco regarding a terminated Letter of Intent (LoI) and claimed that the contract had been awarded to Spanco instead, despite their higher bid.
Tan had said the consortium had received the LoI from the ministry to replace Spanco, but the contract was terminated unfairly before the accrual award was set to be announced.
In January, MACC conducted a raid on the residence of a businessman with the title of 'Tan Sri' for an investigation into allegations of corruption involving the procurement and management of the government's fleet of vehicles worth RM4.5 billion.